Martin Started in the Mail Room at His Company and Worked

question 89

Multiple Choice

Martin started in the mail room at his company and worked his way up to a management position within a few years. For the first six months as manager of the sales department, he reflexively adopted a fairly autocratic style of leadership. The department did well enough, with good sales numbers and a middling level of employee commitment. During his paid vacation, Martin participated in a three-week transformational leadership retreat offered by the corporate headquarters. Tara and Kentaro are two of Martin's employees. They are having lunch two months after Martin's retreat and are discussing his leadership. What do you think they most likely observe about the effect of Martin's new leadership style on the atmosphere in the office?

• A) Kentaro remarks that, if anything, the seminar had had a somewhat negative effect, as Martin is now expecting them to problem-solve on their own, rather than telling them what to do.
• B) They discuss how everyone in the office seems a lot more motivated and how much it has affected their sales numbers, which are the highest the department has reported in years.
• C) Tara remarks that, while there were definite positive changes in Martin's behavior the first few weeks after the seminar, he has since slipped back into his old leadership style.
• D) Kentaro says that while he personally feels more of a connection with Martin, he knows some people do not-for instance, Lupe actually misses Martin's old leadership style.
• E) They both feel they have a more positive relationship with Martin, but their motivation and levels of commitment to the company are the same as they always were.

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Definitions:

Discounted Payback

The period of time it takes to recoup the initial cost of an investment, taking into account the time value of money.

NPV Method

A financial analysis technique that calculates the net present value of an investment by discounting future cash flows to the present value.

NPV Profiles

Graphical representations that show the relationship between the Net Present Value (NPV) of investments and various discount rates.

IRR

The Internal Rate of Return is a metric used in financial analysis to estimate the profitability of potential investments, indicating the interest rate at which the net present value of all the cash flows (both positive and negative) from a project or investment equals zero.